MAJOR chicken meat processor Ingham’s risks legal action after sacking two Victorian farmers last month.
The Victorian Farmers Federation’s Chicken Meat Group has formally requested that the poultry giant renew both farmers’ contracts after they were dumped without warning, despite assurances from Ingham’s management that all contractual conditions were being met.
“These two growers reinvested in their farms at Ingham’s request, they upgraded their facilities at personal expense, and now they’ve had the rug pulled out from under them,” VFF Chicken Meat President Allan Bullen said.
“They were given no warning they would be terminated and this action undermines the confidence growers have in their processor. It’s unprofessional and bad for the whole industry, and unless we get clarification on the situation from Ingham’s, we will be taking further action.”
Ingham’s, which was bought for $880 million by private equity firm TPG Capital in 2013, is gearing up for a public listing on the ASX in November.
Since taking over, TPG has announced it intends to slash Ingham’s 8,000 strong workforce despite the processor last year booking revenues of $2.28 billion.
Mr Bullen said TPG was fattening Ingham’s up for the stock market float, having already stripped $600 million worth of assets from the company, and that the firm’s treatment of loyal suppliers bordered on unconscionable.
“The processor-supplier relationship can be tense at times, but at the end of the day it’s a relationship built on mutual trust and a long-term view for the industry,” he said.
“Ingham’s and TPG have breached that trust by refusing to engage with their farmers and offer any reasonable explanation for why these two growers were let go.
“TPG’s cost cutting regime is only a short-term solution which could jeopardise the long term future of the chicken industry in Victoria, which is something to be very concerned about.”
Mr Bullen said the VFF Chicken Meat Group was attempting to work through the dispute but had hit a wall with Ingham’s management, prompting the Group to consider further action.
“Ingham’s actions are hurting an industry that has historically been held in high regard, and we need to take action to ensure confidence is restored to the Australian poultry industry,” he said.
“We’re sending a message that chicken growers have a strong voice representing their interests.”